LegalZoom Cost My Client $175

My client had hired LegalZoom to form his LLC last November. When he called me last week for help with getting his local licenses, I discovered the Initial List of Members (which was due 30 days after the Articles of Organization were filed) had never been filed. Therefore, his entity had been in default for almost the entire first year. Luckily, he hadn’t started operating yet so he hadn’t been refused an account by a supplier, merchant services company, or bank.

To make things worse, he had to pay $175 in late fees to the state.

If you’re going to have LegalZoom form your entity, make sure they finish the process, or that you know where their services end.